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  1. THE ABCs OF E-RATE John Noran Schools and Libraries Division Universal Service Administrative Company Washington Chicago Los Angeles Newark Sept. 30, 2005 Oct. 6, 2005 Oct. 11, 2005 Oct. 21, 2005

  2. Overview • Schools and Libraries Program • Provides discounts to eligible schools and libraries for Telecommunications Services, Internet Access, Internal Connections, and Basic Maintenance • Applicants can be schools, libraries, or consortia, but only eligible recipients of service can receive discounts • Applicants must apply for discounts each year (Form 471 application filing window) • Funding cap each year is $2.25 billion 2

  3. Overview • Form 471 Application Filing Window • Issues that affect window for FY2006 • Release of final Eligible Services List by the Federal Communications Commission (FCC) • Special Katrina window • Applicants – File Form 470 now • Receipt of recurring services • July 1 – June 30 (12 months) • Receipt of non-recurring services • July 1 – September 30 (15 months) 3

  4. Overview • The ABCs of E-rate • Covers each step of the application process for applicants and service providers • Do’s and Don’ts slides contain program rules • Tips slides contain suggestions that may help applicants and service providers complete the application process successfully. 4

  5. Overview • Application process • Eligibility • Technology planning • Competitive bidding / Form 470 • Calculating discounts • Funding requests / Form 471 • Application review / Funding commitments • Starting services / Form 486 • Invoicing USAC / Form 472 or Form 474 5

  6. Overview • Forms and Letters for Applicants • Technology plan • Form 470 • Receipt Notification Letter (RNL) • Form 471 • Receipt Acknowledgment Letter (RAL) • Funding Commitment Decision Letter (FCDL) • Form 486 • Form 486 Notification Letter (486NL) • Form 472 or Form 474 • BEAR Notification Letter — Form 472 only • Quarterly Disbursement Report 6

  7. Overview • Forms and Letters for Providers • Form 498 • Notification by e-mail • Form 499-A • Notification by e-mail or telephone • Receipt Acknowledgment Letter (RAL) • Funding Commitment Decision Letter (FCDL) • Form 473 • Form 486 Notification Letter (486NL) • Form 472 or Form 474 • BEAR Notification Letter / Invoice Status Report • Electronic notification 7

  8. EligibilityApplicants • Eligible Entities - Schools • Must meet the statutory definition of elementary or secondary school found in the No Child Left Behind Act of 2001. • Must be a non-profit institutional day or residential school, including a public charter school, that provides elementary or secondary education, as determined under state law. • Must not be operating as a for-profit business. • Must not have an endowment exceeding $50 million. 8

  9. EligibilityApplicants • Eligible Entities - Schools • Pre-kindergarten, Adult Education, Juvenile Justice students/facilities may be eligible. • Must provide elementary or secondary education as determined under state law. • USAC requests updated eligibility information from state departments of education every two years. 9

  10. EligibilityApplicants • Eligible Entities - Libraries • Must meet the statutory definition of library or library consortium in the Library Services and Technology Act (LSTA) of 1996. • Must be eligible for assistance from a state library administrative agency under LSTA. • Budget must be completely separate from that of any schools. • Must not be operating as for-profit businesses. 10

  11. EligibilityApplicants • Consortia • Eligible schools and/or libraries may form consortia with • Other eligible schools and/or libraries • Certain health care providers • Public sector (governmental) entities • Only eligible entities can receive discounts 11

  12. Eligible ServicesBoth • Priority 1 – funded first • Telecommunications Services • Basic telephone service — wireline or wireless phone service (local, cellular/PCS, and/or long distance) • Voice mail • Transmission services (T-1, DSL) • Internet Access • Basic conduit access to the Internet 12

  13. Eligible ServicesBoth • Priority 2 • Internal Connections (switches, hubs, routers, wiring) • Basic Maintenance on Internal Connections • Priority 1 funded first, then Priority 2 begins with neediest applicants (90% first, then 89%, 88%, etc.). • Internal Connections funded in only two out of five funding years. 13

  14. EligibilityApplicants • Educational Purposes • Activities that occur on library or school property are presumed to be integral, immediate, and proximate to the education of students or the provision of library services to library patrons and therefore qualify as educational purposes. • Customary work activities of employees of a school or library are presumed to fall under the definition of education purposes. 14

  15. SCHOOLS: Administrative buildings School bus barns and garages Cafeteria offices Facilities associated with athletic activities LIBRARIES: Administrative buildings Bookmobile garages Interlibrary loan facilities Library technology centers • Examples of Non-instructional Facilities (NIFs) that can receive Priority 1 services EligibilityApplicants 15

  16. EligibilityApplicants • Educational Purposes – Priority 1 • Wireless Telecommunications Services used offsite may be eligible. For example, • School bus drivers delivering children to and from school • Library staff providing library services on a library’s mobile library unit van • Teachers or other school staff accompanying students on a field trip or sporting event. 16

  17. EligibilityApplicants • Educational Purposes – Priority 2 • Priority 2 services to NIFs are NOT eligible unless those internal connections are essential for the effective transport of information to an instructional building of a school or to a non-administrative building of a library. 17

  18. EligibilityService Providers • Service Providers • Must file Form 498, Service Provider Information Form • Request a Service Provider Identification Number (SPIN) • Provide/update contact information. • Must file Form 473, Service Provider Annual Certification (SPAC) Form • Required for invoices that reference that Funding Year to be paid. 18

  19. EligibilityService Providers • Providers of Telecommunications Services must be authorized as Telecommunications Carriers • Must contribute to the Universal Service Fund, if applicable. • Must provide telecommunications services on a common carriage basis to be deemed a Telecommunications Carrier. 19

  20. EligibilityService Providers • Telecommunications Carriers must • (1) allow the customer to transmit information of its own design and choosing, without change in the form or content of the information, and • (2) provide that capability for a fee directly to the public, or to such classes of users as to be effectively available to the public (i.e., hold itself out to serve indifferently all potential users). 20

  21. EligibilityService Provider Tips • Keep contact information updated by filing revisions to Form 498 • USAC web site SPIN Search reflects information from Form 498 Block 11 • Designate individual program contacts if new or changed • Telecommunications Carriers – provide Form 499 Filer ID 21

  22. Technology PlanningApplicants • Technology Plans • Not required for basic telephone service • Must be written before Form 470 filing • Must be approved by a certified approver before the Form 486 is filed or discounted services start, whichever is earlier • Must cover all 12 months (or all months of service) • Must cover five specific elements 22

  23. Technology PlanningApplicants • Technology Plans • Must cover five specific elements: • Goals / Strategies for using technology • Professional development • Needs assessment • Sufficient budget • Evaluation process 23

  24. Technology PlanningApplicant Do’s and Don’ts • DO write your technology plan before submitting your Form 470. • DO make sure your technology plan covers and is approved for the entire period (usually 12 months) that discounted services will be delivered. • DO make sure that your technology plan approver is certified by USAC. • DO verify that your certified approval is dated before services begin and before your Form 486 is filed. • DO verify that your plan contains all five required elements. 24

  25. Technology PlanningApplicant Tips • Use each required area as a heading in your plan and address that area under the heading. • PRINT A COPY of your certified approval for your records. • Make sure your technology plan is approved for the entire period (usually 12 months) that discounted services will be delivered. • Prepare a technology plan if any of your services fall outside of basic telephone service (such as Centrex, PBX, T-1). 25

  26. Technology PlanningService Provider Tips • Refer applicants with questions on technology planning to neutral, third-party sources of information such as state web sites. • Avoid giving applicants direct advice on technology planning, especially targeted advice on services you provide. • If you offer assistance, make sure it is neutral technical advice. 26

  27. Competitive Bidding / 470Applicants • Filing Form 470 opens a competitive bidding process. • Can also issue a Request for Proposals (RFP). • Applicants are responsible for ensuring an open and fair process and selecting the most cost-effective provider of the desired services. 27

  28. Competitive Bidding / 470Applicants • Request for Proposal (RFP) • Not required under FCC rules, but a good idea • Must comply with local and state procurement laws • Describes your project scope, location, other requirements in detail • Even if you have an RFP, you must describe the services you desire on your Form 470. 28

  29. Competitive Bidding / 470Applicants • Competition • Goal is to have as many bidders as possible • Promotes better service and lower prices • Fair and open process • All bidders treated the same • No advance knowledge of RFP information • No secrets in the process • All bidders know what is required of them. 29

  30. Competitive Bidding / 470Applicants • Form 470 Deadline • Absolute deadline is 28 days before the close of the Form 471 filing window. • However, if the applicant waits until that date to file a Form 470, the following must all occur on the last day of the window: • Selecting a service provider • Signing a contract • Signing, dating and submitting Form 471. 30

  31. Competitive Bidding / 470Applicants • Selecting service providers • Applicants must choose the most cost-effective solution to their Form 470 or RFP, with price as the primary factor • Other factors can be considered, but price must be the most heavily weighted. • Evaluation process should be carefully documented and that documentation must be maintained. 31

  32. Competitive Bidding / 470Service Providers • Responding to Form 470 / RFP • Download Forms 470 – two options for searching applicant requests • “Search Posted” • Must choose Funding Year • Can then select other criteria • “Download Reports” • Must choose Funding Year • One to five days ago or cumulative • Delimited files 32

  33. Competitive Bidding / 470Applicant Do’s and Don’ts • DO run an open and fair competitive bidding process. • DO wait at least 28 days before selecting your service provider. • DO certify your Form 470 promptly. • DO indicate a multi-year contract or contract with extensions if appropriate. 33

  34. Competitive Bidding / 470Applicant Do’s and Don’ts • DO list services sought in the correct category of service. • If USAC moves your request to another category of service, your Form 470 must have featured that category of service. • DO use price as the primary factor when selecting the most cost-effective solution 34

  35. Competitive Bidding / 470Applicant Tips • Retain worksheets, bid evaluation criteria, winning AND LOSING bids • Prepare a memo to file if you received only one bid or no bids • File (and certify) online • Reduces errors and speeds processing • USAC will issue you a PIN after successful certification of your Form 470 if you do not already have one. 35

  36. Competitive Bidding / 470Applicant Tips • Applicant Personal Identification Numbers (PINs) • Will be issued by secure mailer to all authorized persons on FY2005 Forms 470, 471 and 486. • Will be automatically issued to any new authorized persons filing FY2006 Forms 470, 471 and 486. • After accepting Terms and Conditions, can be used immediately to certify online. 36

  37. Competitive Bidding / 470Service Provider Do’s and Don’ts • DO NOT complete, sign, or file the Form 470. • DO NOT prepare or be involved in the preparation of the RFP. • DO remain neutral at all times during the applicant’s competitive bidding process. 37

  38. Competitive Bidding / 470Service Provider Tips • Service providers may contribute information on technical issues. • Service providers may provide basic program information such as timelines and deadlines. 38

  39. Competitive Bidding / 470Applicants • Form 470 Receipt Notification Letter (RNL) • Cover page of important reminders • Notifies applicant that Form 470 has been posted to the USAC web site • RNL generated before certification • Contains Allowable Vendor Selection / Contract Date 39

  40. Calculating DiscountsApplicants • Discounts are calculated using • Percentage of students eligible for National School Lunch Program (NSLP) • Urban or rural status of county in which school or library is located (from web site) • These two pieces of information are carried into the Discount Matrix 40

  41. Discount Matrix Calculating DiscountsApplicants 41

  42. Calculating DiscountsApplicants • Calculation for individual school • Percentage of students eligible for NSLP for individual school • Urban/Rural status • Find discount from Discount Matrix 42

  43. Calculating DiscountsApplicants • Calculation for school district • Determine discount for each individual school in the school district • Calculate the weighted average of the discounts for all schools in the district • Discounts of individual schools with more students will be weighted more heavily 43

  44. Calculating DiscountsApplicants • Calculation for library outlet/branch • Percentage of students eligible for NSLP in the school district in which the library outlet/branch is located • Urban/Rural status • Find discount from Discount Matrix 44

  45. Calculating DiscountsApplicants • Calculation for library system • Determine discount for each individual outlet/branch in the library system • Calculate the simple average of the discounts for all outlets/branches in the library system 45

  46. Calculating DiscountsApplicants • Calculation for consortium • Determine the discount for each consortium member • Calculate the simple average of the discounts of all consortium members 46

  47. Calculating DiscountsApplicants • Non-instructional facilities (NIFs) are eligible for their school district or library system discount • Online - calculate school district or library system discount, then enter that discount for each NIF (“non-matrix discount”) • School NIFs with classroom(s) — calculate as with individual schools using the student count in the classroom(s) 47

  48. Calculating DiscountsApplicants • Schools with transient populations • Take a snapshot of the student population on a specific day • Report the NSLP eligibility of that student population • RETAIN DETAILED DOCUMENTATION OF YOUR CALCULATION 48

  49. Calculating DiscountsApplicants • Alternative Discount Mechanisms for determining student NSLP eligibility • Must be based on income — family units whose income is at or below 185% of the federal poverty guidelines (Income Eligibility Guidelines) • Must be collected from a survey or from existing sources • Must tie to individual students (with one exception, projections are not allowed) 49

  50. Calculating DiscountsApplicants • Examples of Alternative Discount Mechanisms • Participation in food stamps, Supplementary Security Income, Federal public housing assistance, Low Income Home Energy Assistance Program • Existing sources that are based on federal poverty guidelines • Matching siblings 50